Paying £2880 into pension when retired

Dazed_and_C0nfused

Qyburn said:

drumtochty said:

No you are all wrong here with regards to pension tax relief in Scotland.

I am not sure I follow your calculations but I can say with 100% certainty that my pension contributions have saved me 41% tax.  I am looking at my 21/22 calculation right now.

100% agree, quite sure the poster has misunderstood something about how RAS contributions work and the impact on your income tax liability.

Nebulous2

You can claim the extra 1% if you are a 21% taxpayer, which is what the poster is mixing up with, but you can also claim the higher rate tax relief for higher tax rates than 21%. 

HMRC clarifies pensions tax relief rules for new Scottish income tax bands - Money Age

"Pension scheme members who are Scottish taxpayers liable to Income Tax at the Scottish higher rate (41 per cent) and Scottish top rate (46 per cent) will be able to claim additional relief on their contributions up to their marginal rate of tax in the usual way, either in their self assessment tax return or if they don’t complete a tax return by contacting HMRC."

drumtochty

Dazed_and_C0nfused said:

Qyburn said:

drumtochty said:

No you are all wrong here with regards to pension tax relief in Scotland.

I am not sure I follow your calculations but I can say with 100% certainty that my pension contributions have saved me 41% tax.  I am looking at my 21/22 calculation right now.

100% agree, quite sure the poster has misunderstood something about how RAS contributions work and the impact on your income tax liability.

OK, I cannot find my workings but in my particular circumstances due to paying dividend tax at a higher rate from non ISA wrapped shares made taking the taxed SIPP amount in this tax year was uneconomic.

For those people without that issue it is worthwhile to a smaller degree around the £43,666 region doing £2,880 into a SIPP with no earned income.

singhini

drumtochty said:

 £2,880 into a SIPP with no earned income.

Out of curiosity, can a child (15 year old) open a SIPP and put £240 in each month and receive the 20% tax relief i.e. £60 uplift even though they have no income?

Rob749

Short answer is Yes you can. Google Junior SIPP 

sevenhills

Once you have decided that you need the money in a SIPP and draw some out.
Do you then just add £2880 per year to the drawdown SIPP or do you open a new one.
I assume you could open a SIPP with a new provider, because a different platform could favour the same contribution amount.

dunstonh

Out of curiosity, can a child (15 year old) open a SIPP and put £240 in each month and receive the 20% tax relief i.e. £60 uplift even though they have no income?

A child cannot but their parent or guardian can.  It will be the child's pension but the administration needs to be done by the parent/guardian.

Short answer is Yes you can. Google Junior SIPP  

There is no such product type.    That is a marketing name by a certain provider to try and obtain business.  Virtually all providers of SIPPs, stakeholder pensions and personal pensions will accept minors as a pensionholder.

Rob749

dunstonh said:

Out of curiosity, can a child (15 year old) open a SIPP and put £240 in each month and receive the 20% tax relief i.e. £60 uplift even though they have no income?

A child cannot but their parent or guardian can.  It will be the child's pension but the administration needs to be done by the parent/guardian.

Short answer is Yes you can. Google Junior SIPP  

There is no such product type.    That is a marketing name by a certain provider to try and obtain business.  Virtually all providers of SIPPs, stakeholder pensions and personal pensions will accept minors as a pensionholder.

You are right of course, but most providers are calling it a Junior SIPP, probably because as you said, its in the child's name but.....from one of those providers :-
" A Junior Self-Invested Personal Pension (SIPP) is a tax-efficient account to help you save for a child's future. It offers more flexibility and choice than other types of child pensions. It gives you control over the investments until the child reaches 18 and can manage their own account. " They all quote this in one form or another.

dunstonh

You are right of course, but most providers are calling it a Junior SIPP, probably because as you said, its in the child's name but.....from one of those providers :-

They would call it chocolate pension if they thought it would sell more.

You see variations of this with other financial services areas.  Such as some as some online annuity specialists.  Until you realise that they have multiple websites and/or trading styles for each business area there is.

peteduk

Hi,
First thank you to all who contribute here. I appreciate it very much having acted on the advice for my wife for the last 5 or so years. Unfortunately I wasn't aware of it before then.
My wife has a SIPP with HL which we manage by adding the £2880, and benefitting from the tax free allowance - she is a non taxpayer so we withdraw all but a token amount each year.
I understand her ability to do this ends at age 75 which she is, next October.
Are we able to continue in the 2023-24 tax year or was this tax year her last?
Thank you